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I have about $6k in the account set up with my old employer (Fidelity). My new employer uses Principal. I also have a personal Roth IRA I set up. I don't like the idea of having retirement money in three different accounts (I'd prefer a max of 2), but I'm not sure what goes into the rollover and if extra fees are charged or not.
No fee with a rollover, but you have to do it in a certain way to avoid taxes/penalties. Both of those companies will have a process for doing it in the correct manner and smoothly. People roll over 401ks all the time.
One note, if you roll over that 401k into your Roth, you will now owe taxes on the roll over. 401k is before tax withdrawal, Roth is after tax. However, its only 6K so the taxes would likely still be manageable.
I don't know what the issue with 3 accounts is but I would roll the funds into your Roth if the taxes aren't going to hurt you (small amount so they should not) or open a traditional IRA. I wouldn't roll it into your employer's 401K because you lose control of those funds--if you have to withdraw them mainly.
I don't know what the issue with 3 accounts is but I would roll the funds into your Roth if the taxes aren't going to hurt you (small amount so they should not) or open a traditional IRA. I wouldn't roll it into your employer's 401K because you lose control of those funds--if you have to withdraw them mainly.
Stupid me, I actually do have a traditional, not Roth, IRA. Do I still have to pay taxes on the rollover amount?
For simplicity, I don't want to have multiple accounts open but I can manage this if it saves me money.
roll it over into your existing IRA (traditional). no taxes on the rollover. Who do you have the IRA with? They handle everything, it's pretty seamless. I've got to consolidate. I currently have
1. current employer 401k with Fidelity
2. current IRA with Schwab
3. Wife's current 401k with CVS on their own website (used to be with principle)
4. Wife's former employer 401k with ML
if not for mint.com, it'd be a mess to check the balances.
Stupid me, I actually do have a traditional, not Roth, IRA. Do I still have to pay taxes on the rollover amount?
For simplicity, I don't want to have multiple accounts open but I can manage this if it saves me money.
Thanks!
Not if you do a direct roll-over. If you have them send you the money and you deposit it, yes, they will take out taxes. You do have 90 days to get those funds into an IRA and you can get the money back at the end of the year but it's just easier to do the direct rollover
I don't like all those funds my employer offers for 401K plan. Unfortunately I don't have any other choices. Once I will move on from my current job I will roll my pension savings to IRA, so I can buy some stocks.
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